Our Analytics 12 february — 14:34

Aliyev concept: Fight unemployment with self-employment (Our comment)

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BY ELDAR ALIYEV, ECONOMY SECTION

It is very difficult to recall a meeting at which President Ilham Aliyev would not pay particular attention to solving social problems and improving public welfare. A recent conference on the results of the first year of the implementation of the State Program for the Socio-Economic Development of regions in 2019-2023 also made no exception. Government media described in detail the most ambitious and acute problems in the social sphere. And against the background of millions of people and billions of manats covered by them, information about self-employment somehow quietly flashed. Although…

Since 2016, Ilham Aliyev began implementing the concept of self-employment

The Ministry of Labour and Social Protection of the Population embarked on a self-employment program on behalf of the head of state in 2016. And Azeri Daily was among the first mass media to draw attention to this undertaking then. The economic situation in the country left much to be desired, and the size of social assistance to those in need was impossible to cut. So the idea came up of attracting some of those in need to self-employment, when they could not only provide for themselves, but also sell surplus of manufactured products. But the needy therefore lived in need because they did not have the capital to run their own households.

And the state decided not just to give them benefits, but to provide the most enterprising of them with primary assets for their chosen field. Please note that it's not just giving out money for micro-business, but providing with assets: farm animals, non-sophisticated tools and equipment. The first lucky ones could then be counted on the fingers. And not only because it was not so easy for them to go through trainings and peculiar exams. Of course, there was little money allocated for the first step, and the risk was great...

Here is such a unique self-employment program: to provide for oneself and to sell surplus products

And last year, 10 thousand 354 citizens were involved in this program. They completed the relevant trainings and successfully defended their business plans. On the eve of the conference, as the Minister of Labour, Sahil Babayev reported, 8500 people acquired their assets. But the asset allocation process continued, and by the end of January the rest were also fully provided with assets. It is hard to imagine that the initiative of the president in the execution of the Ministry of Labour in such a short time has acquired such proportions. Thousands of families in need have now their own micro-business. True, some of them continue to receive benefits, but gradually this need disappears. And all this happens under close supervision and the active assistance of the corresponding ministry service. According to experts, this approach is beneficial both to the state and the population. Believe us, a one-time small financing of such families is much more profitable for the state than the issue of social benefits to them for years. And a person provided with self-employment no longer experiences feelings of humiliation, own worthlessness, but becomes an active member of society.

A good start does not go unnoticed. The UN Development Program and the Public Association for Regional Development of the Heydar Aliyev Foundation soon joined the self-employment program. Within the framework of only these two projects, the process of providing assets for another 500 people is being carried out. But the head of state is not satisfied with the successes achieved in a short time. He instructed the ministry to expand this program by connecting the World Bank to this issue. The Ministry of Labour has already completed preliminary discussions with the WB, as well as negotiations on a loan agreement. After approval of the agreement in accordance with the World Bank procedure, it is expected to be signed by June. It would seem that it is not long to wait. But the ministry is not waiting: after active discussions with the Ministry of Finance and the World Bank, the Ministry of Labour began to carry out preparatory work before signing the agreement on the basis of the retroactive principle of financing since February.

Yes, the process of expanding the program of self-employment of the population, which ensures the transition from a passive labour market policy to active social protection measures, is moving ahead at a rapid pace. And the connection of the World Bank to it, according to the forecasts of Minister Babaev, will lead to an increase in the current coverage of 10 thousand families to at least 15 thousand next year. In total, the WB plans to allocate a loan of $100 million for this project. At the initial stage, the project will cover 27 districts, and from 2021 it is planned to expand its coverage to other regions of the country. It aims to improve employment opportunities among women, youth, people with disabilities, recipients of targeted social assistance and internally displaced persons who are either inactive in the economic life of the country or unemployed.

Sahil Babayev reports: 8500 people acquired their assets

However, the joint project with the WB will only support activities that are not related to the livestock sector. This area can be supported only within the framework of a self-employment program funded by the government of the country, and it is no less interested in this. According to Sahil Babayev, the self-employment program for this year is estimated at 63 million manats. During the year, only at the expense of the Unemployment Insurance Fund it is planned to finance the participation in self-employment projects of 11 thousand families. And after joining the WB project, the number of such families will increase. The WB share is estimated at 1-2 thousand families. But in subsequent years, 5 thousand families will be stably financed by the WB.

What next? If in 2016 only a handful of families were covered by self-employment, in 2017 there were a little more than 1 thousand, then last year this figure reached 10 thousand. And a year later another 5 thousand families will join the self-employed squad. Well, then this figure is likely to be measured in tens of thousands. It is difficult to calculate even the economic efficiency of the program, not to mention its moral side. Thousands of families from ordinary recipients of benefits are turning in their eyes into self-sufficient entrepreneurs who produce wealth and provide services. And thus, the problems of unemployment and poverty are simultaneously solved. Yes, the effective implementation of the head of state's decree 'On Additional Measures to Ensure Self-Employment of the Population' of 2016 helps increase labour productivity and economic activity of the population, increase family incomes, create additional jobs, as well as increase the number of taxpayers and social insurance payments.

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